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GAO discussed the status and future plans for the Department of Defense's (DOD) Defense Support Program (DSP) and Milstar satellite communications system. GAO noted that: (1) DOD has decided to terminate and replace its current DSP follow-on program to reduce costs and consider new tactical requirements; (2) DOD needs to evaluate the new DSP system's effectiveness and affordability before systems implementation in 1995; (3) DOD has placed greater emphasis on reducing Milstar's high cost and increasing its support to tactical forces; (4) DOD could significantly reduce program costs by cancelling its procurement of the two large-sized satellites and initiating early development of a lower cost system of smaller satellites; and (5) further cost reductions can only be achieved if DOD changes its procurement, operation, and use of space assets.